Equipment Financing

When a company has to purchase new machinery or equipment, securing a general commercial loan might not be the smartest option. A better option is to apply for specialized equipment financing. There are several ways to do this: by leasing new machinery, issuing a sale-leaseback, or securing a loan using the equipment as collateral.  Whether Its Medical Equipment For Your Growing Office, Or Replacing Your Entire Trucking, Or Aircraft Fleet, We Have Your Covered.

Learn More About Equipment Financing

Whether it’s heavy machinery, fleet vehicles, or new high-tech equipment, the price tag on these items can be quite high. Unfortunately, for many small businesses, this puts new equipment out of reach. While borrowing money through a generic loan can pay for new equipment, it could be risky. There are three primary ways to finance equipment:

Leasing

Rather than purchasing machinery outright, a company can lease it from a third-party lender. The benefits of leasing include a lower cost of maintenance, the ability to upgrade to new machines once the lease expires, and a reduced monthly payment. The downside, however, is that the equipment loses liquidity.

Lease Buybacks

Companies that already own high-end equipment can sell those materials to a leasing agent to generate emergency cash flow. The company receives payment for the machinery up front, then signs a lease agreement. The money from the sale can help smooth out cash flow problems and the company gets to continue using its equipment.

Equipment Loan

When leasing and lease buyback doesn’t fit, a business can secure financing for an equipment purchase. These loans use the equipment as collateral, which secures the loan and makes it easier for borrowers to qualify.

Learn More About Equipment Financing

Whether it’s heavy machinery, fleet vehicles, or new high-tech equipment, the price tag on these items can be quite high. Unfortunately, for many small businesses, this puts new equipment out of reach. While borrowing money through a generic loan can pay for new equipment, it could be risky. There are three primary ways to finance equipment:

Leasing

Rather than purchasing machinery outright, a company can lease it from a third-party lender. The benefits of leasing include a lower cost of maintenance, the ability to upgrade to new machines once the lease expires, and a reduced monthly payment. The downside, however, is that the equipment loses liquidity.

Lease Buybacks

Companies that already own high-end equipment can sell those materials to a leasing agent to generate emergency cash flow. The company receives payment for the machinery up front, then signs a lease agreement. The money from the sale can help smooth out cash flow problems and the company gets to continue using its equipment.

Equipment Loan

When leasing and lease buyback doesn’t fit, a business can secure financing for an equipment purchase. These loans use the equipment as collateral, which secures the loan and makes it easier for borrowers to qualify.

Loan Highlights

Almost all equipment can be purchased with these loans, including high-tech devices and some software programs.

Loan terms are usually lengthy, with some options extending up to 25 years.

Lease buyback programs offer upfront payments and agreeable lease terms.

Most equipment loans come with no prepayment penalty.

Equipment Financing Pros and Cons

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